Social assistance and household consumption in urban China: from 2002 to 2013

Abstract

Using the China Household Income Project (CHIP) 2013 urban data and a propensity score matching method, this study examines the association between participation in China’s primary social assistance program, Dibao, and household consumption patterns. Results reveal that urban Dibao recipients prioritized spending on education and health compared to their non-recipient counterparts. In addition, Dibao receipt was found to be associated with decreased consumption in making ends meet and social participation. Comparing these findings with those focusing on the same topic but using CHIP 2002 and 2007 data, we find that the positive association between urban Dibao receipt and household total consumption was statistically significant in 2002 and 2007, but became nonsignficant in 2013. Across all 3 years, urban Dibao remained its significant association with increased expenditures on education and health, two forms of important human capital investments.HighlightsWe use the China Household Income Project 2013 data to examine the association between urban Dibao participation and household consumption.Urban Dibao recipients increased spending on education and health but decreased consumption in making ends meet and social participation in 2013.From 2002 to 2007 and then to 2013, urban Dibao was consistently associated with increased expenditures on education and health.The relative effect sizes of Dibao’s positive effects on education and health both increased from 2002 to 2007 but decreased from 2007 to 2013.Urban Dibao was found to be associated with decreased spending on making ends meet in 2013 but not in 2002 or 2007.